The Formation Mechanism of SMEs' Credit Risk Under Supply Chain Finance Based on Game Theory

Abstract

Small and medium-sized enterprises (SMEs) that have difficulty in financing are the weak link in the supply chain. In recent years, with the development of the supply chain management concept and financial institutions business, the supply chain financial model emerges as the times require. It not only helps SMEs in the supply chain to finance, but assists the core enterprises to expand their business scope and obtain value-added profits, which has become an effective way to solve the financing difficulty of SMEs. This paper in the supply chain studies the formation mechanism of credit risk of SMEs by using the game model. The paper obtains the factors that affect the credit risk through the balanced income of banks and core enterprises in the game model and analyzes the behavior decision-making and the probability of occurrence of credit risk of SMEs and banks via using the revenue function. And it reveals the formation mechanism of credit risk of SMEs and makes up for the existing research on the formation mechanism of credit risk without SMEs in the supply chain finance. Eventually, combined with the specific results of the game model, it puts forward practical suggestions for the participants of the supply chain finance to reduce the credit risk and promote the win-win of the participation of the supply chain finance. Eventually, combined with the specific results of the game model, it puts forward practical suggestions for the participants of the supply chain finance to reduce the credit risk and promote the win-win of the participation of the supply chain finance.